The following balance sheets were taken from the records of Blalock Company: Blalock Company Comparative Balance Sheets At December 31, 20X1 and 20X2 1   20X1 20X2 2 Assets     3 Cash $150,000.00 $185,000.00 4 Accounts receivable 70,000.00 80,000.00 5 Investments 0.00 30,000.00 6 Plant and equipment 100,000.00 105,000.00 7 Accumulated depreciation (30,000.00) (32,000.00) 8 Land 20,000.00 30,000.00 9 Total assets $310,000.00 $398,000.00 10 Liabilities and equity     11 Accounts payable $40,000.00 $50,000.00 12 Bonds payable 60,000.00 0.00 13 Mortgage payable 0.00 50,000.00 14 Preferred stock 20,000.00 0.00 15 Common stock 100,000.00 160,000.00 16 Retained earnings 90,000.00 138,000.00 17 Total liabilities and equity $310,000.00 $398,000.00 Additional transactions were as follows: A. Sold equipment costing $12,000, with accumulated depreciation of $9,000, for $2,000. B. Retired bonds at a price of $60,000 on December 31. C. Earned net income for the year of $68,000; paid cash dividends of $20,000. Required:   Prepare a statement of cash flows using the indirect method.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Statement of Cash Flows

 

Instructions

 

Amount Descriptions

 

Statement of Cash Flows - Indirect Method

 

X

Instructions

The following balance sheets were taken from the records of Blalock Company:

Blalock Company

Comparative Balance Sheets

At December 31, 20X1 and 20X2

1

 

20X1

20X2

2

Assets

 

 

3

Cash

$150,000.00

$185,000.00

4

Accounts receivable

70,000.00

80,000.00

5

Investments

0.00

30,000.00

6

Plant and equipment

100,000.00

105,000.00

7

Accumulated depreciation

(30,000.00)

(32,000.00)

8

Land

20,000.00

30,000.00

9

Total assets

$310,000.00

$398,000.00

10

Liabilities and equity

 

 

11

Accounts payable

$40,000.00

$50,000.00

12

Bonds payable

60,000.00

0.00

13

Mortgage payable

0.00

50,000.00

14

Preferred stock

20,000.00

0.00

15

Common stock

100,000.00

160,000.00

16

Retained earnings

90,000.00

138,000.00

17

Total liabilities and equity

$310,000.00

$398,000.00

Additional transactions were as follows:

A. Sold equipment costing $12,000, with accumulated depreciation of $9,000, for $2,000.
B. Retired bonds at a price of $60,000 on December 31.
C. Earned net income for the year of $68,000; paid cash dividends of $20,000.

Required:

 

Prepare a statement of cash flows using the indirect method.

 

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